Goldman Sachs commodity analysts have revised their price forecast for Brent crude upwards, now expecting the benchmark to average $105 in December and remain elevated next year as well.
This represents a nearly 17% increase from Goldman’s previous December forecast of $90 per barrel, with the team citing heightened risks to supply security, as reported by Bloomberg. The revision, which is the latest in a series of such revisions coming from various banks, comes despite multiple reports about oil flows from the Persian Gulf returning to pre-war levels and even topping them.
Next year, Goldman’s analysts expect Brent crude to average $88 per barrel, up from $80 per barrel in an earlier forecast.
“Eight months of adapting to disrupted Middle Eastern supply have materially weakened the buffers that absorbed the initial shock,” ANZ’s commodity analysts said in a note last week, as they also revised their Brent crude forecast up by 10%, now expecting the benchmark to end 2026 at $105 per barrel. UBS sees the benchmark at $110 per barrel at the end of the current year.
Analysts appear to be unanimous in their opinion that the only thing that could lead to consistently lower oil prices is a peace deal between Iran and the United States. As Goldman’s Daan Struyven put it in a recent update, “For the risk premium to come off quickly, you would probably need to see a diplomatic solution that market participants see as sustainable.”
The chances of that happening by the end of the year remain slim, despite a recent return of optimism resulting from reports about three-day talks between Iranian and Qatari officials on a possible peace agreement.
Meanwhile, everyone is watching the U.S. midterms tomorrow and what happens after them, as both Iran and the U.S. signal they are keeping their options open and are ready for both peace and more war.
By Irina Slav for Oilprice.com
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